Over 95 per cent of CWU workers have endorsed the legally binding pensions agreement with Royal Mail.

The purpose of the agreement is to safeguard the future of the Royal Mail Pension Plan and to improve the Royal Mail Defined Contribution Plan.

The RMPP has been amended so from 1 April members’ basic pensionable pay will increase by the higher of RPI (up to 5 per cent) each year, or any promotion or increment within members’ current pay grade group as at 31 March.

According to the agreement, the RMDCP will be amended with effect from 1 June. The contributions payable during the first year of an employee’s membership of the RMDCP remain unaltered, but after this if a member contributes 4 per cent of pensionable pay the company will pay 7 per cent.

If a member pays-in 5 per cent the company will contribute 8 per cent.

New pension governance arrangements will also be established “to safeguard the future of the RMPP and develop the RMDCP. The union will be invited to join the Royal Mail Pensions Policy Committee to review performances of the plan and also the investment strategies”.

Royal Mail chief executive Moya Greene said the agreement is “the first critical step to provide long term stability and certainty for Royal Mail, its employees and its customers”.

“The implementation of the pay and pensions agreements does not change the financial outlook for Royal Mail or our medium term objectives,” Greene said.

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